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Don’t decimate our budgets, boroughs tell TfL

Funding

15 May 2020
 

London boroughs are urging Transport for London not to slash the budget for borough transport improvements as it struggles with Covid-19 financial problems (see story above). 

Reductions in grant will add to the problems facing boroughs, who have already seen their transport plans hit by the huge loss of income from parking and developer contributions caused by the virus lockdown. 

Borough concerns are set out  in a letter to London transport commissioner Mike Brown from Mark Frost, chair of the London Technical Advisors Group (LoTAG) strategic transport group, and Dan Jones, chair of the London Environment Directors Network (LEDNet). 

Recognising that TfL’s financial position has been devastated by the virus, Frost and Jones offer to work with TfL to “agree the options available” for borough funding, and ensure that the “impacts of any reduction in funding” are managed so that “local capacity to deliver transport projects is retained as far as practicable”. 

“We are particularly concerned that a severe and immediate reduction in borough funding, across all the various streams that TfL makes available to boroughs, could deal a fatal blow to the capacity of boroughs that may be difficult to reverse in future,” say Frost and Jones. 

“We estimate that well over 600 borough transport jobs are either wholly or partly funded by TfL local implementation plan (LIP) formula funding or from other ‘discretionary’ pots such as ‘liveable neighbourhoods’, or ‘Mini-Hollands’. 

“Removal of this funding would therefore lead to significant redundancies, particularly as the ability to easily furlough staff in local government employment is under question. Further jobs are obviously also at risk through the construction supply chain.” 

Frost told LTT that, prior to Covis-19, boroughs had received notification from TfL of part of their allocations for 2020/21.

“Our formula funding allocations (plus the £100k local transport funding) had been confirmed. That totalled around £74.5m. Some boroughs also received confirmation of liveable neighbourhood funding and other TfL ‘discretionary pots’.”

The grant has not yet been paid to boroughs, however, because they claim funding from TfL in arrears.

Boroughs are facing a huge reduction of income from other sources that fund transport. “Collectively, boroughs are anticipating a fall of over £250m in income from parking fees and charges and penalty charge notices, though in a scenario where the lockdown lasts in the autumn and winter this figure could be closer to £500m,” say Frost and Jones. 

“This funding is often used to support borough transport schemes and to cover staffing costs. In recent years it has increasingly been used to support highway asset maintenance, given the reduction in funding for this task from TfL. 

“Based on the current [emergency funding] announcements by central government we are not anticipating that these losses will be covered to any significant extent.”

Developer contributions are also taking a hit. “Across London income from Section 106 and Community Infrastructure Levy (CIL) in the coming months is predicted to plunge as developers delay consented scheme commencements or seek to re-negotiate agreements. 

“Already there are many requests for CIL payments to be waived and S106 agreements to be renegotiated. Fee earning works on the highway (through S278 or S38 agreements) are also largely on hold. 

“Taken together, these cuts represent an existential level of risk to borough transport capacity, which we note has already been reduced significantly after a near decade of cuts to general local government funding.”

Frost and Jones say there is a risk that boroughs may “no longer be able to assist TfL in delivering the mayor’s transport strategy (MTS) in any meaningful way”.

“This would be particularly damaging because, as the MTS acknowledges, the boroughs are a key delivery partner as the authorities, which manage the vast majority of London’s highway network.”

They say a “severe reduction” in borough capacity will also “hamper the opportunity for officers to work with TfL to explore how some of the positive behaviour changes observed on the network in recent weeks (improved air quality, more active travel, reduced private vehicle trips etc) can be locked-in and a ‘new normal’ forged. 

“This could therefore represent an historic missed opportunity in what is likely to be a very small window of time where people may be open to doing things radically differently.” 

They want TfL and the Greater London Authority to agree an emergency settlement for boroughs in 2020/21. “This should provide enough certainty to allow for the prevention of a severe reduction in borough officer headcount, and for scheme development and design to continue as far as possible, allowing for these to be rapidly progressed to site in 2021/22. 

They accept that some projects, “even some that are very far advanced, may need to be paused”.  

 
 
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